Robinson Roe

Independent Review of the APS: Submission by Rob Roe

Introduction

The APS’s Mission: “Advising successive Australian governments and serving the Australian

people well”
The Independent Review’s Purpose: “The time is right to examine the capability, culture and

operating model of the APS, to ensure the APS is ready to capitalise on these opportunities,
improve citizens’ experience of government, and deliver better services.”
This submission recommends the exploration of the the Integral Organisation Model as a

framework for the new APS operating model. The Integral Organisation Model uses business

and academic research that has studied organisations to determine the appropriate
“capability, culture and operating model”. This research was used in completing my master’s

thesis which combined all this research into a framework called the Integral Organisation

Model. The term Integral comes from Ken Wilber’s Integral Model which is used by Frederick

Laloux in his book Reinventing Organisations. Laloux refers to a Teal Organisation. The colour

Teal is a stage of vertical development described in Wilber’s Integral Model.
The Integral Organisation Model is being used to analyse three For-Purpose organisations as

part of an forthcoming book, Giving Hope. I have personally used the Integral Organisation

Model to lead teams within large organisations as well as a unicorn start-up.
The Integral Organisation Model can be thought of as a “Grey’s Anatomy” for organisations

and therefore can be used to analyse trends such as Agile, Lean, Teal, Holacracy and

determine how they fit into the overall approach.
As such it can be used to determine the best medicine for what ails the APS.
The Organisation Structure Dilemma

The dilemma facing how to operate a complex organisation such as the APS starts with the

question: do we implement a Function-Based structure (products, services, departments) or

do we implement a Mission-Based structure (citizen-centric)?
The answer is we need both. But how?
We need both, because while we want to be citizen-centric, we can’t build an individual

health, road, tax, social services, etc, system for each individual person in Australia. These

have to be shared services. Like hospitals that can be used by a community, a road network

shared by motorists and all the other necessary services provided by the APS.
The problem that shared services create is overtime they become inwardly focused and the

services they provide stop meeting the needs of the external citizen’s. This is compounded by

the complexity of the highly variable needs across individuals, communities, cities and States.
To manage this complexity, the inward focus drives shared service offerings to a “one size fits

all” approach. Where the “one size” is what is best for the department not the citizens

receiving the service. Stafford Beer who used cybernetics to study organisations described

this approach of “one size fits all” as managing complexity by ignoring it. He went on to say

that ignorance is dangerous.
Reading through the submissions on the website there is a common theme of this disconnect

occurring between provider and citizen. One example is where Centrelink stopped paying a

92-year-old pensioner in order to create a compelling event to review their welfare eligibility.
While this may be effective for the department it is not a great experience for the 92-year-
old.
This inward focus is compounded when we need to operate across multiple functions or

departments. Again, there are many comments in the submissions regarding the difficulty in

having multiple departments collaborate together.
With alignment of how we operate based on our functions we cannot fulfill our mission of
“Advising successive Australian governments and serving the Australian people well”. This is

because we are not actually serving the Australian people well and due to the inward focus,
we cannot advise successive governments what is happening in citizen land because we

literally don’t know. We only know what we are doing, while we ignore the complexity.
Companies trying to deploy Agile Models or Lean Thinking approaches make the mistake of

creating cross-functional teams but leave them to operate within a function-based

environment. This ultimately pulls the cross-functional teams apart.
Therefore, what is the answer?
A Citizen-Based Operating Model

We need to have a separate operating model, Citizen-Based, that works across our

organisational structure, which is Function-Based. Not an operating model that is also

Function-Based.
What this means is having processes, systems and measurements aligned to our citizens. For

example, our thinking immediately changes if our department is measured on the quality of

life of our 92-year-old and not just eligibility compliance?
By having our processes, systems and measurements aligned to our citizens we create closed

feedback loops on how well our functions (products, services, departments) are doing in

serving Australian people. This is a very different way of operating and is very confronting to

the traditional function-based approach. It is confronting because the reality of how well we

are delivering the services our citizen’s need is now front and centre. It is not hidden by

functional performance charts, disconnected from what is happening on the ground. We only

have to read through the submissions to this review to hear of this disconnect between

services and citizens’ needs, even if we discount by half the submission’s veracity.
Another key enabler of having our processes, systems and measurements aligned to our

citizens is that it guides our decision making in what to do. A catalyst for this independent

review is described as;
“However, a range of global, technological and public policy developments are
transforming our economy and society. The time is right to examine the capability,
culture and operating model of the APS, to ensure the APS is ready to capitalise on
these opportunities, improve citizens’ experience of government, and deliver better
services.”
If we are to “capitalise on these opportunities, improve citizen’s experience of government

and deliver better services” we need to be able to decide what, when and where to use these
new opportunities. Often, we fall victim to someone having a solution which is looking for a

problem. We need to start with problems, in the context of our mission, to be able to decide

what is the best solution. This is achieved by having an operating model aligned to citizen’s.
Alistair Mant describes this as making ternary decisions, as opposed to the binary decisions

we find in function-based operations.
“The simplest way to illustrate the binary/ternary distinction is to refer back to the
democratic process. If you vote according to what you take to be your own or your
family’s best interests, you are voting binary – if you gain, somebody is bound to lose.
If you vote according to what you take to be the best for your country, even if you
expect to disadvantage yourself in the short term, then you are voting ternary – the
relationship of everybody to the higher-order ideal takes precedence over the win/lose
relationship between people or sectional interests. By the way, the ternary route is
more intelligent, it demands more thought. It requires the citizen to connect personal
desire with the duties of citizenship. Not voting at all is binary by definition.”
Intelligent Leadership, Alistair Mant

Okay, if the answer is to implement a citizens-based operating model that works across our

function-based organisational structure the next question is how?
The Integral Organisation Model

The Integral Organisation Model is made up of the following components;
• Mission-to-Market Map
o Recursive Operating Layers
• The 4 Ms:
o Mission and recursive Nested Mission Statements
o Measurements aligned to outcomes
o Manifestations
o Management Model, operational not functional
• Vertical Development Requirements by Layers

The following is a very brief description of these components which doesn’t fully explain how

the Integral Organisation Model can be implemented but hopefully creates enough interest

for further investigation.
Mission-to-Market Map

The Mission-to-Market Map describes how we operate as opposed to how we are structured.
It allows us to determine which layers of our organisation should be doing which tasks. It also

enables ternary decision making aligned to the nested mission statements up and down the

recursive layers of our organisation.
A generic Mission-to-Market Map looks like the following diagram;
Figure 1: Generic Mission-to-Market Map

Using Elliot Jaques’s Stratified Systems Theory, which aligns with Stafford Beers’ Viable

Systems Model, the separation of vertical layers is based on the complexity and timeframes

that are found at each layer. For example, at the top level of the APS the leadership is

contemplating the long-term future of its own organisation for the next fifteen or more years

and commissioning independent reviews such as this one. At the individual contributor layers

people are focused on the immediate requirements of their community.
For the APS the Mission-to-Market Map would be used to map out the various layers of

government; Federal, State and Local, to determine which tasks are carried out by which

layers. This would also address when to use shared services and when to use dedicated local

services.
FYI, Jaques’s Stratified Systems Theory has been used by Enhancer Executive Advisors to map

the Swedish Police Force covering all the layers, roles and the vertical development capability

of the current person in each role. Stafford Beer’s Viable System Model was used to manage

the nationalised economy of Salvador Allende’s government in Chile.
A major difference between the Mission-to-Market Map’s Management Model versus the

traditional function-based approach is that the product & services are at the bottom of the

hierarchy not the top. This changes the measurement of the outcome from internal function

to citizen outcome, as per our 92-year-old pensioner example.
The Outcome Manager

To make this change we need to change the top down management model by implementing

the role of Outcome Managers. The Outcome Manager oversees the delivery of the solution

that best fits the needs of the citizens in their domain. The products & service are delivered

by the shared service departments but the Outcome Manager determines what is required

and whether these needs are being met.
A great example of this is Southwest Airlines. In order to meet their mission of “friendly,
reliable, and low-cost air travel” Southwest Airlines have an operational target of turning

planes around in twenty minutes. They know that if they are effective in fully utilising their
assets they can deliver low-cost air travel. To ensure they meet their operational target they

have created the role of an Airport Manager. The Airport Manager has the authority over

every decision regarding the operation of their airport. Not the Executive Vice President of

Pilots, the Vice President of Ground Crews, Central Procurement, nor the Cabin Crew

Manager. The Airport Manager has the empowerment and accountability to ensure that

planes are turned around on time. They have ownership. Working with the teams to;
streamline processes, assign resources, solve systemic issues, anything that is needed to be

as effective as possible. A manifestation of this is that not just the cleaners clean the planes,
but also the cabin crew and pilots!
The Southwest Airline Airport Manager is measured on consistently meeting the turnaround

target time at their airport. If this is not being met they work with the functional teams to

identify roadblocks that stop them being effective in meeting the twenty minutes. Decision

making is fast and ternary based. The Airport Manager is operating at layer 3 of our Mission-
to-Market Map.
Recently on a British Airways flight out of Heathrow, London, there was a late minute change

of the type of plane. This forced a seat reassignment which split up a family of five who were

not happy. I was on the flight and noticed a man sorting out the problems. When he turned

around on the back of his hi-vis-vest were the words, “Turnaround Manager”. He was the

Outcome Manager to ensure planes left on time. The British Airways “Turnaround Manager”
is at Layer 5 of our Mission-to-Market Map.
Masaaki Imai, Lean Thinking consultant and author of Gemba Kaizen, explains how the layers

of our organisations provide support to deliver “customer satisfying value” at Gemba. Gemba

is a Japanese word that means truth or real place. It is used here to represent the place where

value is created; at a Southwest Airline Airport or Heathrow, London.
“In or at gemba, customer satisfying value is added to the product or service that
enables the company to survive and prosper. Figure 2.1 places gemba at the top of the
organization, showing its importance to the company. The regular management layers

• top management, middle management, engineering staff and supervisors - exist to
  provide the necessary support to the work site. For that matter, gemba should be the
  site of all improvements and the source of all information…
  …When management does not respect and appreciate gemba, it tends to “dump” its
  instructions, designs, and other supporting services - often in complete disregard of
  actual requirements.
  Management exists to help gemba do a better job by reducing constraints as much as
  possible. In reality, however, I wonder how many managers correctly understand their
  role. More often than not, management regard gemba as a failure source where things
  go wrong, and they neglect their responsibility for those problems.”
  Gemba Kaizen, Masaaki Imai

With the Outcome Manager role in place we can see how the 4 Ms apply in guiding them to

fulfil their responsibilities.
Missions: the nested mission provides the guidance to be able to make ternary decisions.
That is, decisions that are based on achieving better outcomes. This alignment of decision

making naturally cuts through function-based silo turf wars. For Southwest Airlines to achieve
“friendly, reliable, and low-cost air travel” the nested mission for the Airport Manager

includes making sure planes turned around in 20 minutes.
Measurements: the measurements are based on the effectiveness of meeting the nested

mission. Are we turning the planes around on time? Do we have satisfied passengers? These

measurements mean that there is nowhere to hide. In the function-based approach it is very

easy to create finger pointing because no one owns the end outcome.
Manifestations: the culture across all of the teams is about achieving the nested mission.
Working together, making ternary based decisions to deliver on the best outcome.
Management helps to remove roadblocks, address systemic issues and are not regarding
“gemba as a failure source”.
Management Model: The management model is focused on effectiveness and not efficiency.
It is the leadership and management naturally working together in making us as operationally

effective as possible.
The Outcome Manager replaces the need for layers of middle management as they are no

longer required. This is because the previous task of middle management is to provide a

coordination layer between functional departments and teams. When we cannot gain

agreement across the functions we escalate to middle management. In the mission-based

operating model the outcome manager settles disputes by using ternary decision making. A

value statement of the Agile movement is “being able to do more with less” this is because

we work together to decide the best outcome without having to escalate to middle

management.
A critical advantage of mission-based recursive operations is the ability to handle complexity.
The challenges and variables at one airport, one community or one family getting on a plane,
are different from one occurrence to the next. The outcome manager is able to make

decisions on the spot to get things done there and then.
Layers of Government and Outcome Managers

In the APS we are facing variables that differ from the outback of Western Australia, to Sydney

suburbia, on to rural population hubs like Shepparton. To be worked through but we could

find the Outcome Manager in the Local Council, State or Federal Government or a

combination of all.
For major shared service departments such as Centrelink there would be assignments

between the customer facing staff within the department and the local outcome managers.
This could be that the call centre is divided up into smaller teams based on local councils.
These smaller teams work closely with the local outcome manager to ensure the best services

are provided to each specific citizen groups.
An example of this in action comes from the shared service maintenance crews of the US

Airforce Fighter Squadrons. General Bill Creech explains;
"the one large flight line-wide maintenance organization was broken into three
identical 'squadron' teams. Each was responsible for its own twenty-four aircraft, and
each squadron was broken into four flights of six aircraft. Within each squadron and
flight all the various disciplines worked together in small teams to get the job done.
Each squadron had its own goals. Each did its own scheduling which had been done
centrally before. Each made its own decisions and charted its own course. And we
carried those themes of ownership and empowerment down all the way to the
frontline level.
For example, each fighter aircraft was assigned a 'dedicated crew chief' [Outcome
Manager] who, with an assistant, was totally responsible for that specific aircraft. We
painted his or her name on the side of the fighter, and they went with it everywhere.
We had gone from a vertical to a horizontal arrangement and the authority and
accountability flowed in that manner. That gave focus to authority and accountability
in an integrated product sense; and it removed the ambiguity about who was
accountable for what. Before, the aircraft mechanics and various specialists might
work on as many as six different aircraft a day, and on a different six the following day.
That approach of unfocused responsibility was replaced by the integrated teams,
providing ample focal points at all levels for product focus and performance
assessment.
Accountability for poor performance was easy to track. It was equally easy to single
out those who deserved recognition for stellar performance - both individuals and
groups. Our measurements of those focal points soon began to reflect the power of
motivation, pride and commitment.
The motivational aspects of the new approach can perhaps best be described by citing
the insights of a young three-striper crew chief. Not long after we began, I was visiting
one of TAC's many bases. As usual I was mingling with the workers at the frontline
level to find out what was really going on. The first crew chief I approached smiled as
he shook my hand and said, "I really like the new arrangement and the dedicated crew
chief program General Creech", I said I did too, and asked him why he liked it so much.
He responded, "When was the last time you washed a rental car?" That said it all. He
and his colleagues now exercised real ownership.
The fighters still landed with problems from time to time, of course, as airliners do. But
they were fixed and returned to service far more rapidly. For example, we improved by
an astounding 270 percent the rate of fixing aircraft on the same day they landed
'broke'. We were now able to fix more than four out of five aircraft immediately. As
opposed to only one out of five under the old system. That meant they were available
within minutes or a few hours, as contrasted to a day or days before. We also more
than doubled our ability to generate sorties in combat."
Five Pillars of TQM, General Bill Creech

Vertical Development Requirements

To complete our understanding of how to implement mission-based recursive operations we

need to look at the vertical development of people. This is because we need people with

greater vertical development to lead this new operation approach. Our Southwest Airport

Manager is operating at Layer 3, while our British Airways Turnaround Manager is operating

at layer 4 or 5.
Horizontal Development – refers to the adding of more knowledge, skills, and
competencies. It is about what you know, which we can assess through measurement
of competencies e.g.360-degree feedback.
Vertical Development refers to advancement in a person’s thinking capability. The
outcome of vertical stage development is the ability to think in more complex,
systemic, strategic, and interdependent ways. It is about how you think, which we can
measure through stage development interviews and surveys.
Nicholas Petrie, http://www.nicholaspetrie.com/vertical-leadership-development/
By creating mission-based recursive operations this changes the roles of leader/managers at

each layer. They are no longer the coordination layer, which requires horizontal development,
pulling together the different functions to deliver an outcome. They now need to operate as

described by Maasaki Imai where they are taking a broader view, removing roadblocks,
solving systemic issues in order to support the creation of value. This requires greater vertical

development capability as we rise through the layers.
When we combine the layers of our Mission-to-Market Map, the 4Ms and the Vertical

Development we can determine the roles, responsibilities and operations for each recursive

layer. Below both a Function-Based and Mission-Based approach are shown to provide a

comparison. The terms Planning, Doing, Leading, Belonging are based on the four

perspectives of Ken Wilver’s Integral Model.

Summary

This is a very brief explanation of the Integral Organisation Model and how it can be applied

to the Australian Public Service.
It doesn’t adequately explain all of the concepts and how they can be applied but hopefully it

does provide enough detail for the panel to want to investigate the model further.
Thank you for your consideration,
Robinson Roe